Scanmarket eSourcing Summit – Milk and a Mystery Man

At the Scanmarket customer eSourcing summit last week, there were some very good client presentations and we also had a chance to speak to quite a few interesting people on the client side. There were around 40 guests in attendance, which turned out to be a good number in terms of getting the chance to have some quite detailed discussion with people over dinner and the subsequent day.

Scanmarket has been around for 15 years now, and clearly has a pretty blue-chip client base, with a particular strength in eSourcing and auctions, where their product sells heavily on ease of use – as we will see.  Quite a few of the clients we met wanted to be anonymous (for reasons we will also get into), but there were a number of large and well known FMCG firms as well as others from media, utilities and elsewhere.

We enjoyed the session led by Ilse Claus, Group Procurement Manager (CPO in effect) at Milcobel, Belgium’s largest dairy group. Over the past 18 months, she has built a procurement function from scratch – as she said to me over coffee, my presentation was all about whether procurement has a future, whereas she said “we are just starting on the journey at Milcobel”! That does show that we can forget how varied the maturity of procurement is around even large organisations.

She has used eSourcing as a key tool to demonstrate the value of procurement. The benefits have come from greater transparency, efficiency and a more structured approach – as well as hard cost savings. That has been vital in a “start-up” environment for procurement. Managing stakeholders has been a major challenge, and she has had to deal with the whole “my category / sole supplier is different” argument many times!

But it was a good story from an impressive and relatively young procurement leader. She also talked about her experience of taking people from the business into procurement, and there was some interesting discussion about whether that was better than bringing in outside expertise – we will save that debate for another day.

Another conversation we had over dinner was with a senior executive who has both line management role as CPO of a division within his company, a large group, and also acts as the technology lead on the procurement functional board. Since he brought in Scanmarket around 3 years ago, after an exhaustive selection process, and to replace “another well-known eSourcing tool”, the number of sourcing events has gone from around 40 a year to some 2,000!

“Around 40% of those involve an auction of some sort, although we almost always start with an RfX process prior to the auction” he said. The firm is one of the most advanced auction users I have come across – Japanese, Dutch, standard reverse are all in the regular repertoire. There is also a big focus on “super-users” who have been key to driving event numbers upwards, as has the user-friendliness of the Scanmarket platform.

But why didn’t our hero want to be identified? Because the firm sells to the big supermarkets, and “if they knew how effective our sourcing is, they would want to see the savings passed on”, he said.  An interesting angle …

And there’ll be more from the Scanmarket event shortly in part 2.

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